Table 4-7
Table 4-7 shows the demand and supply schedules for the labor market in the city of Pixley.
-Refer to Table 4-7. Suppose that the quantity of labor supplied increases by 40,000 at each wage level. What are the new free market equilibrium hourly wage and the new equilibrium quantity of labor?
A) W = $8.50; Q = 550,000
B) W = $12.50; Q = 630,000
C) W = $9.50; Q = 610,000
D) W = $11.50; Q = 610,000

Question

Table 4-7
  Table 4-7 shows the demand and supply schedules for the labor market in the city of Pixley.
-Refer to Table 4-7. Suppose that the quantity of labor supplied increases by 40,000 at each wage level. What are the new free market equilibrium hourly wage and the new equilibrium quantity of labor?
A) W = $8.50; Q = 550,000 
B) W = $12.50; Q = 630,000 
C) W = $9.50; Q = 610,000 
D) W = $11.50; Q = 610,000

Quizplus · Accepted Answer

The new equilibrium quantity of labor is 610,000. The new free market equilibrium hourly wage is $9.50.

Table 4-7 Table 4-7 Shows the Demand and Supply Schedules